PepsiCo

PepsiCo is a global food company which comprises Frito-Lay North America, PepsiCo Beverages North America, PepsiCo International and Quaker Foods North America. In 2006 it had revenue of $35 billion. The company was formed in 1965 as a result of the merger of Pepsi-Cola and Frito-Lay. In 1998 it bought Tropicana and in 2001 merged with The Quaker Oats Company, including Gatorade. 


 * Former Chair and CEO - Steven S. Reinemund

Dressing up junk food as "Smart Spot" foods
After a survey found that only 10 percent of respondents rated PepsiCo as a company that was "concerned with my health," placing it near the bottom, PepsiCo was adamant about positioning itself as part of the solution. So, in 2005, PepsiCo launched the "Smart Spot" program, a self-congratulatory stamp of approval on its own products that are deemed healthier alternatives. According to PepsiCo, the green check mark symbol is designed to make people's lives simpler by serving "as a shortcut, an easy way for consumers to identify a broad range of food and beverage choices from PepsiCo that contribute to a healthier lifestyle." The program is aimed particularly at moms, who, according to Ellen Taaffe, PepsiCo's vice president of Health and Wellness Marketing, can use the Smart Spot to "make some healthier choices to help move their families toward healthier lifestyles."

Because PepsiCo continues to make products that don't meet its self-selected Smart Spot criteria, PepsiCo divided its products into "good for you" and "better for you (Smart Spot offerings), and "product alternatives" and "fun-for-you" foods (non-Smart Spot items). PepsiCo rates more than 200 of its products as healthier, "Smart Spot" foods, including diet soda and baked potato chips.

Pepsi will also launch a pilot project, called "Perfect Storm," later this year, "in a major U.S. city with a significant population of both African-Americans and Latinos." It's targeting "urban youth and 'ethnic gatekeepers'" because "Smart Spot" marketing doesn't "always resonate with minorities."

Nutrition "education" programs
PepsiCo has launched a number of educational programs geared at teaching nutrition to children, including Balance First (in-school curriculum), Get Active Stay Active (part of the President's Challenge), Get Kids in Action, Kidnetic.com, P.E. 4 Life (Gatorade sponsored), S.M.A.R.T. Living (part of the Smart Spot program), and America on the Move. These programs are touted by PepsiCo as helping poor schools with much-needed resources, despite the fact that PepsiCo's principal purpose is to generate revenue from the sale of unhealthy foods and drinks.

In November 2005, PepsiCo opened the first of a planned thirteen branded playgrounds for kids in Washington, D.C. Brock Leach, PepsiCo's chief innovation officer explained that the playgrounds were "all about moving more, helping kids move more." All of the equipment bears the company's "SmartSpot" logo.

"Reality marketing"
"The study of people in their natural environment is, The Hartman Group believes, the future of marketing," explains a Seattle Post-Intelligencer story. So this market research firm, which has worked for Whole Foods, PepsiCo and Campbell Soup Company, has sent two sociocultural anthropologists into a private home for up to nine months, to "observe the family's eating habits." 

This new approach - called "reality marketing" - will fill "an enormous void in the intellectual capital of the entire industry," said The Hartman Group's Michelle Barry. Pepsi's vice-president of consumer and customer insights, Dwight Riskey, agrees. "This generates a richness that we wouldn't get from standard techniques," he said. The Hartman Group's CEO, Harvey Hartman, stressed the importance of observing one family over time: "The fluidity of life is the power behind reality marketing." 

PepsiCo ceases funding for animal tests
Following a year of negotiations, People for the Ethical Treatment of Animals (PETA) received a written statement from PepsiCo that the company would cease funding animal testing as of May 2007.


 * "PepsiCo does not conduct any animal tests and does not directly fund any animal tests on its beverages and foods. Where governmental agencies require animal tests to demonstrate ingredient safety, companies using those ingredients rely on third party testing. PepsiCo has shared our concern regarding the ethical and humane treatment of animals with our suppliers and others in the industry. We encourage the use of alternative testing methods whenever and wherever possible and have financially supported research to develop these alternative methods."

Animal tests funded by PepsiCo
Testing funded by PepsiCo included the implanting of testosterone pellets and human prostate tumors into mice; inducing colon cancer in rats by injecting chemicals and infecting mice with respiratory viruses then forcing them to exercise on treadmills for three consecutive days; after which they were killed. The last experiment was a "student research project" funded by the Gatorade Sports Science Institute.

Coca-Cola follows suit
Days after PepsiCo's announcement on May 27th, rival Coca-Cola, made a similar announcement on May 31st. PETA's campaign against Coke and Pepsi lasted for approximately one year.

Ad boycott against Air America Radio
Pepsi refused to advertise on the progressive Air America Radio. In October 2006, around 90 companies, including PepsiCo, told ABC Radio Networks that they did not want their ads to play on radio stations that carried Air America Radio.

Public relations
In July 2009, PepsiCo announced it was retaining the public relations firm Edelman, for a "multimillion-dollar corporate reputation campaign." According to Pepsi's vice-president of strategic communications, P.J. Sinopoli, the contract includes "rais[ing] awareness among PepsiCo stakeholders about the totality of the PepsiCo brand," along with "showcasing the company's healthier snacking options and its CSR (corporate social responsibility) work." Also working on the contract are the firm Luntz, Maslansky Strategic Research, on "message management," along with Edelman's research arm, StrategyOne.

Political contributions
PepsiCo gave $302,092 to federal candidates in the 05/06 election cycle through its political action committee (PAC) - 26% to Democrats, 73% to Republicans, and 1% ($5,000) to independent Joseph Lieberman (I-CT).

Lobbying
PepsiCo spent $880,318 for lobbying in 2006. $592,900 went to seven outside lobbying firms with the remainder being spent using in-house lobbyists. Some of the firms were Mehlman Vogel Castagnetti, Lesher & Russell, and Alliance for American Advertising.

Personnel

 * Nestor T. Carbonell is their Vice President, International Public Affairs.
 * Roger A. Enrico, former Chair and CEO

Directors
Accessed March 2008:


 * Dina Dublon
 * Victor J. Dzau
 * Ray L. Hunt
 * Alberto Ibargüen
 * Arthur C. Martinez
 * Indra K. Nooyi
 * Sharon Percy Rockefeller
 * James J. Schiro
 * Daniel Vasella
 * Michael D. White

Contact details
700 Anderson Hill Road Purchase, NY 10577 Phone: (914) 253-2000 Fax: (914) 253-2070 Web: http://www.pepsico.com

Related SourceWatch articles

 * Animal testing
 * People for the Ethical Treatment of Animals
 * Coca-Cola
 * Edelman
 * Obesity PR
 * PepsiAmericas
 * Donald M. Kendall - Cofounder
 * Wahid Hamid

External articles

 * Wikipedia article on Pepsi Co
 * Kristen Millares Bolt, "Tonight's special: Reality marketing: Researchers follow family to see what they buy and eat", Seattle Post-Intelligencer, October 1, 2005.
 * Chad Terhune, "Pepsi Outlines Ad Campaign For Healthy Food", Wall Street Journal, October 15, 2005; page A4. (Sub req'd).